Timber industry starts off New Year with major milestone  A landmark event occurred in the last few weeks of 2016 between the EU and Vietnam government that promises to have far-reaching favourable implications for the development of sustainable timber industry trade. In November, following nearly six years of negotiations, the two sides agreed in principle on the terms of a Voluntary Partnership Agreement (VPA) to improve forest governance, address illegal logging and promote trade in verified legal timber products from Vietnam to the EU. The two sides are expected to ratify the agreement in early 2017. "Vietnam and the EU today celebrate a milestone in their cooperation in the global fight to end illegal logging," said EU Commissioner for Environment, Maritime Affairs and Fisheries Karmenu Vella, at the signing ceremony for the new VPA last November. "Now we must focus on implementation to ensure that the VPA delivers on its social, environmental and economic goals.” To implement the VPA, Vietnam has agreed to put a timber legality assurance system in place among other reforms— including the passage of legislation to ensure the legality of timber Vietnam imports from other countries for processing and re-export. The European Commission has published a memo describing the VPA and timber legality assurance system. When this system is operating as described, it will ensure that exports from Vietnam of timber and timber products to the EU will be entirely from verified legal sources. “A key commitment is to establish a credible and robust system, which involves all stakeholders and includes effective mechanisms to detect violations and ensure law enforcement,” said Vella. The EU would continue to support the efforts of the Vietnam government in this regard and would be monitoring closely how the country works to implement the agreement, he noted. The VPA is expected to boost confidence in the legality of timber products exported by Vietnam, as well as deliver wider social and environmental benefits. An EU-Vietnam Joint Implementation Committee would oversee implementation of the VPA once it enters force. Until then, key elements of the interim arrangements have been agreed that would help transition to the implementation phase. The decision by the parties to sign the agreement, which would eventually lead to a requirement for licensing by the Forest Law Enforcement, Governance and Trade facility of the EU of all timber products imported into the EU from Vietnam, was jointly announced by Vella and Vietnam Minister of Agriculture and Rural Development Nguyen Xuan Cuong following a meeting on November 17. The range of timber products included in the scope of the agreement encompasses all major products exported by Vietnam to the EU – particularly logs, sawn timber, railway sleepers, plywood and veneer. In addition, it includes many ancillary timber products such as wood chips or particles, parquet flooring, particle board and wooden furniture. Innovation is critical to competitiveness, was the message of Mr Hans- Joachim Danzer, Chief Executive Officer of Danzer Holding AG, at the ECE Committee on Forests and the Forest Industry in Geneva, Switzerland. There are significant opportunities for Vietnam and other countries to increase yield and reduce material costs in the international hardwood industry, he continued, but these are being squandered due to a widespread lack of capacity and willingness to innovate. There’s also a need to work with Vietnam and others towards a smarter regulatory environment, driven more by sound scientific data and less by the concerns of narrow lobby groups, to encourage innovation, improve competitiveness and stimulate trade in the industry. Mr Danzer offered these views from the perspective of a company that is the largest producer of decorative sliced wood worldwide and amongst the largest producers of sawn hardwood in Africa and North America.  VOV